Questions from General Taxation

Q: Determine Amos’s gross income in each of the following cases.

Determine Amos’s gross income in each of the following cases. a. In the current year, Amos purchased an automobile for $25,000. As part of the transaction, Amos received a $1,500 rebate from the manu...

Q: The Bluejay Apartments, a new development, is in the process

The Bluejay Apartments, a new development, is in the process of structuring its lease agreements. The company would like to set the damage deposits high enough that tenants will keep the apartments in...

Q: Julie is considering three alternative investments of $10,000.

Julie is considering three alternative investments of $10,000. Julie is in the 28% marginal tax bracket for ordinary income and 15% for qualifying capital gains in all tax years. The selected investme...

Q: Determine the taxpayer’s gross income for tax purposes in each of the

Determine the taxpayer’s gross income for tax purposes in each of the following situations. a. Deb, a cash basis taxpayer, traded a corporate bond with accrued interest of $300 for corporate stock w...

Q: Al is a medical doctor who conducts his practice as a sole

Al is a medical doctor who conducts his practice as a sole proprietor. During 2015, he received cash of $280,000 for medical services. Of the amount collected, $40,000 was for services provided in 201...

Q: Lisbeth makes the following interest-free loans during the year.

Lisbeth makes the following interest-free loans during the year. The relevant Federal interest rate is 5 percent, and none of the loans are motivated by tax avoidance. All of the loans were outstandin...

Q: Leilei operates a sole proprietorship, using the accrual basis of tax

Leilei operates a sole proprietorship, using the accrual basis of tax accounting. Last year, she claimed a $10,000 bad debt deduction for a receivable from Jackie. But this year, Jackie sent her a che...

Q: Champ received a $10,000 distribution from NeatCo, a

Champ received a $10,000 distribution from NeatCo, a U.S. C corporation. NeatCo’s earnings and profits for the year totaled $6,000. How much dividend income does Champ recognize? What Federal income t...

Q: Many years ago, Jack purchased 400 shares of Canary stock.

Many years ago, Jack purchased 400 shares of Canary stock. During the cur- rent year, the stock became worthless. It was determined that the company “went under” because several corporate officers emb...

Q: The Egret Company has a 40% combined Federal and state marginal

The Egret Company has a 40% combined Federal and state marginal tax rate. Egret’s board estimates that, if its current president should die, the company would incur $200,000 in costs to find a suitabl...